The Role of Analytics in Spurring Business Development

ARTICLE | Mar 14, 2016

It’s no secret that a thriving economy goes hand-in-hand with a thriving community. Where jobs and developments are, there people will want to be as well. As many communities have discovered, the key to growing an economy is often through recruiting retailers, restaurants, and other businesses to a city.

Though recruitment efforts can be quite challenging, many communities have found success through the use of analytics, which gives unbiased and reliable data for cities to present to major businesses.

Two cities that found success in their recruitment efforts are North Augusta, South Carolina and Caribou, Maine. Both used analytics to recruit a large business to their community that then led to an upswing in their overall economic climate.

North Augusta, South Carolina recruits Scuttle’s Island Water Park to its trade area

While recruiting retailers and restaurants to North Augusta, the growing City received an unexpected opportunity. A group of investors showed interest in North Augusta when seeking a location for Scuttle’s Island, a 40 acre, multi-million dollar water park. The City recognized the huge potential in this development and began the recruitment process. Community leaders turned to analytics to present three sites for the potential water park to the investors. They researched the distance that visitors would drive to reach a water park and ran custom reports for each site to show how many households within the specified drive time of each site were likely to have visited a theme park within the last year.

The detailed presentation greatly impressed the investors and helped them make the decision to locate Scuttle’s Island Water Park in North Augusta.

In an article from CBS News 12 WRDW, Reporter Alma McCarty revealed that the water park is a $25 million dollar project, set to open in May 2016 and is expected to welcome approximately 300,000 visitors per season to the City.

North Augusta City Administrator Todd Glover was quoted as saying, “From a tourism perspective for us – it’s a big deal.”1 Glover also mentioned in a separate interview that if even 10 percent of the park’s projected visitors stay overnight in North Augusta, the number of hotel guests will be greater than the city’s population.

An additional benefit of the water park’s opening can be seen in new development interest from hotels and restaurants. Though North Augusta is still on the cusp of its retail economic development, it is certain that the recruitment of Scuttle’s Island Water Park will prove profitable for the City.

Caribou, Maine recruits Sitel Operating Corporation to its downtown

Caribou, Maine, a city of approximately 8,000 residents, is the most northeastern city in the United States. For many years, Caribou’s economy was mostly based off of a nearby U.S. Air Force base, but when the base closed as part of a military realignment in 1994, nearly $83 million in annual payroll left the community.

Gaining new jobs was at the forefront of community leader’s minds. To help in this process, Caribou partnered with an analytics company to guide their business recruitment efforts. Their initial focus was to fill a vacant city-owned building in downtown Caribou. City leaders soon set their sights on Sitel Operating Corporation, one of the world’s leading outsourcing providers in the region. Caribou knew that Sitel’s presence downtown would greatly benefit the economy, but the company was considering many sites at the time.

Caribou went about recruiting the business by leveraging analytics. Caribou ran custom 15 minute and 5 minute drive-time reports to show the population around the downtown site and the other sites that Sitel was considering. This data helped Sitel understand what a 15 minute drive-time really meant in rural Caribou, as opposed to a metropolitan area, and showed them exactly where their workforce was concentrated. This data motivated Sitel to purchase the downtown building from the City of Caribou, which brought 300 new jobs to the area.

Caribou City Manager Austin Bleess said in an interview, “Being able to show the population numbers, the available workforce within the specific drive-time area of the site in our downtown was key.”

The growth in jobs downtown has benefitted other businesses in the area as well. Many retailers and restaurants have seen increases in traffic due to the increase of workers in the area. Caribou’s economy now has strong momentum and the City looks forward to welcoming more jobs and businesses in the near future.

The Bottom Line

Local governments would be wise to use analytics when beginning their business recruitment efforts. As the case studies from North Augusta and Caribou show, analytics can greatly influence a project’s outcome because it allows city leaders to present data-driven insights to developers. By presenting a united front, proactively working to meet the needs of developers, and providing data-backed recommendations on locations, cities can recruit developments that will benefit their communities for years to come.

As Vice President and General Manager of Buxton’s city government division, Cody Howell leads Buxton’s expert community consulting team. He advises municipalities on retail economic development and the use of consumer analytics, helping to shape growth strategies for client municipalities nationwide.

COG hosted a gathering of more than 100 area leaders—representatives from local governments, businesses, nonprofits, and civic associations—for a regional conversation with Amazon on its plans to locate its new headquarters